Building up on an earlier post on the Multiplier effect, there’s another important rule – the rule of incremental and consistent effort. The best summary of the rule is this:
The other side of the rule suggests that if you’re consistently doing less than yesterday, how big of a negative impact would it lead to:
For those who don’t have so much of a mathematical interest in the equations, the point of this rule is that regardless of the size of base, an incremental yet consistent positive change everyday can bring in massive improvement in a year. The flip side being that a marginal yet consistent reduction can lead to massive decrease in the starting base in only a year.
This rule can practically be applied almost anywhere – savings, investments, work effort, planning goals, manual labor, personality and skill improvement – practically anywhere.
To sum up, the real power is always in the progress in whatever you do and not really where you start. This is the real reason many startups end up challenging and outperforming massive companies in the long-run. Also the reason why some people seem to keep achieving everything whereas a lot of people don’t seem to be able to much done despite spending hours at length in intermittent sprints. This is also a valid reason to consistently put our best foot forward – finally, this is how many leaders have transformed themselves and even the fate of their nations in less than their lifetime.
“The most perfect political community must be amongst those who are in the middle rank, and those states are best instituted wherein these are a larger and more respectable part, if possible, than both the other; or, if that cannot be, at least than either of them separate.” – Aristotle
These arguments below speak to the different ways the strength of the middle class affect economic growth and stability:
A strong middle class promotes the development of human capital and a well educated population.
A strong middle class creates a stable source of demand for goods and services.
A strong middle class incubates the next generation of entrepreneurs.
A strong middle class supports inclusive political and economic institutions, which underpin economic growth.
Historically, middle class has brought around all the revolutions, and brought changes for the better.
Middle class is usually a healthy section of the society, where physical and mental abilities of the society usually peak.
To sum up, a strong middle class is a prerequisite for robust entrepreneurship and innovation, a source of trust that makes business transactions more efficient, a bulwark against credit booms and busts and a progenitor of virtuous, forward-looking behaviors, such as valuing education. Moreover, middle class spending usually creates the most prominent multi-layered economic multiplier effect, since most of such spending would trickle down many levels.
“I have to live for others and not for myself: that’s middle-class morality.”